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Texas Instruments (TXN) Dips More Than Broader Markets: What You Should Know

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Texas Instruments (TXN - Free Report) closed at $129.46 in the latest trading session, marking a -0.51% move from the prior day. This change lagged the S&P 500's daily loss of 0.39%. Elsewhere, the Dow lost 0.95%, while the tech-heavy Nasdaq lost 0.83%.

Heading into today, shares of the chipmaker had gained 1.01% over the past month, outpacing the Computer and Technology sector's gain of 0.35% and the S&P 500's loss of 0.1% in that time.

Investors will be hoping for strength from TXN as it approaches its next earnings release, which is expected to be October 22, 2019. On that day, TXN is projected to report earnings of $1.41 per share, which would represent a year-over-year decline of 10.76%. Meanwhile, our latest consensus estimate is calling for revenue of $3.81 billion, down 10.58% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.32 per share and revenue of $14.67 billion, which would represent changes of -4.83% and -7.06%, respectively, from the prior year.

Any recent changes to analyst estimates for TXN should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.21% lower within the past month. TXN currently has a Zacks Rank of #4 (Sell).

Investors should also note TXN's current valuation metrics, including its Forward P/E ratio of 24.48. For comparison, its industry has an average Forward P/E of 19.97, which means TXN is trading at a premium to the group.

Also, we should mention that TXN has a PEG ratio of 2.42. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Semiconductor - General stocks are, on average, holding a PEG ratio of 2 based on yesterday's closing prices.

The Semiconductor - General industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 194, which puts it in the bottom 24% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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